The following legal response is from Scharff, Brady & Vinding, a Sacramento law firm representing Cottonwood Investors, Inc:
March 21, 2008
Philip Henderson
Miller, Brown, Dannis, Attorneys
71 Stevenson Street, 19th Floor
San Francisco, CA 94105
Re: Woodland Joint Unified School District’s Notice of Material Breach, Cottonwood Investors, Inc.
Dear Mr. Henderson:
Scharff, Brady & Vinding (“SBV”) represents Cottonwood Investors, Inc. (“CWI”). SBV is in receipt of your March 17, 2008, letter regarding a purported material breach by CWI of the lease of the building at 626, 628 and 630 Cottonwood Street, Woodland, California (“Lease”). This letter constitutes CWI’s initial response to the allegation of material breach. CWI will provide a full response in 7 days, after SBV has had the opportunity to conduct a detailed review of the Lease provisions you cited.
This response provides, as you requested, a Health Risk Assessment of the indoor building air at 628 Cottonwood Street, Woodland, California, conducted on March 20, 2008, by Western Geo-Engineers. (Exhibit A)
This response does not include records of maintenance, repair or replacement of air and heating systems at the District Office at 626, 628 and 630 Cottonwood Street (“Building”). Maintenance of these systems is the responsibility of the tenant, Woodland Joint Unified School District (“WJUSD”). Therefore, WJUSD, not CWI, has the requested maintenance records.
Nor does this response include copies of test reports conducted from 1998 to the present. WJUSD has copies of the vapor sampling conducted by Western Geo-Engineers on June 14, 2000. Other than that testing, all vapor sampling conducted at the Building was done by testers hired by WJUSD. WJUSD should have records of those samplings. Records of that testing is also listed in the inside air portion of the Quarterly Reports and is reproduced in the attached Health Risk Assessment.
As regards WJUSD’s allegation of material breach based on the habitability of the Building, no such breach exists. The findings of the Indoor Air Quality Survey conducted by Schutze and Associates (“Schutze”), at the behest of WJUSD, do not indicate otherwise.
Schutze’s survey found PCE levels of 2.7 ug/m3 in Unit 628. This result is, contrary to WJUSD’s characterization, completely unsurprising. Tetrachloroethene (“PCE”) is found in virtually all residential and workplace environments. In fact, a joint study conducted by the EPA and the California Air Resources Board (“ARB”) found that the mean 24-average residential air PCE concentrations in California range between 2.27 to 6.72 ug/m3. (See, Exhibit B) Thus, the 2.7 ug/m3 in Building 628 is within the normal expected range. Furthermore, this normal concentration of PCE occurred without the presence of carbon filters on the ventilation system.
In addition, Schutze’s survey is flawed because it uses the Regional Water Quality Control Board’s (“RWQCB”) established Environmental Screening Levels (“ESL”) incorrectly. ESLs are merely a threshold level at which the RWQCB requires that a Health Risk Assessment be conducted. ESLs are not the levels at which a per se health risk is present.
As the air in the Building is at, or below, levels considered normal for a building without a known external source of PCE, WJUSD’s demand for monthly testing is unreasonable. CWI is not responsible for maintaining the Building’s air at PCE levels less than the level that is normal for uncontaminated buildings. Moreover, the Benzene and Toulene levels detected by Schutze’s survey indicate that active transfer of chemicals from WJUSD employees’ clothing is occurring. CWI has no control over whether WJUSD employees wear clothing that has been dry cleaned using PCE. CWI also has no control over WJUSD employees’ use degreasers or other products that contain PCE.
In conclusion, CWI does not believe a material breach of the Lease has occurred. However, CWI is investigating the allegations made by WJUSD and will respond fully within 7 days. If CWI’s investigation concludes, as suspected, there has been no material breach, CWI will vigorously defend itself. Further, CWI will further hold WJUSD in breach if WJUSD takes any action in violation of the Lease.
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